What Marketers Need to Know About Third-Party Cookies

The death of third-party cookies has been a hot topic in marketing, and recent announcements have pushed the conversation into the spotlight again. Marketers are scrambling for solutions as Google Chrome moves to remove these marketing tools from its platform.

While first-party cookies are useful for displaying content and a cookie banner or two, they don’t provide the same level of sophistication as tracking cookies. In fact, cookies set the standard for many parts of modern digital marketing.

As the door closes on this chapter of marketing (or, should I say, the browser window?), it’s time to take a look at the controversial life of third-party cookies. This is a unique blog post, as I will not directly cover email marketing. However, the impending demise of third-party cookies will impact some email marketers!

However, most email marketing does not need third-party cookies when done properly. In fact, many email campaigns now rely on reliable zero-party data, which contains information that users voluntarily provide.

Nonetheless, anyone who owns a website or works in e-commerce must know about third-party cookies, and now is the time to adapt to upcoming changes. This blog is a must-read, and you can’t miss the tips and tricks I've included about alternatives to third-party cookies.

So, what are they? How have third-party cookies influenced marketing? And, more importantly, how can we stop asking our customers to enable cookies?

What Are Third-Party Cookies?

Before we can really dig into the implications of Google’s momentous plan, we must understand what a cookie is.

Behind the scenes, cookies are little more than a bit of fancy JavaScript code. Think of them as dog or cat hair. You may not mean to pick up cookies as you browse the web, but you will — whether you like it or not — and they stick with you.

The Origin of Internet Cookies

For the curious folks of the world, it may be interesting to know that internet cookies were not originally meant to be used as marketing tools. In fact, the first internet cookies — as designed by Lou Mantulli — were meant to help people set user preferences across multiple websites.

At its birth, the cookie had only one form. First-party cookies were held, managed, and read by the issuer, and their ability to collect user data was limited.

By 1997, the browser cookie was a ubiquitous feature on the web. Moreover, developers had formed data-sharing alliances, allowing them to exchange user data across multiple sites. While this was not Mantulli’s original goal for cookies, the outcome has irrevocably shaped the digital advertising industry.

The Difference Between First-Party Cookies and Third-Party Cookies

So, what’s the difference between Mantulli’s original vision — the first-party cookie — and the third-party cookies that permeate the modern internet?

While there are a few differences between these concepts, it all boils down to the source of the data. First-party cookies are issued, read, and managed by the host domain. In other words, a first-party cookie won’t work on another website, nor will other websites be able to read its information.

Comparatively, third-party cookies allow non-host domains — or, as the name implies, third parties — to access and collect user information. For example, a website may include a Facebook link with third-party cookies from Facebook.

How Do Marketers Use Third-Party Cookies?

While businesses are focusing on on-site optimization, the recent trend in web development is towards building a better website by improving user experiences. These new demands put added pressure on marketers as they monitor all these platforms for content and conversions.

Since the advent of third-party cookies, marketers have been trying to figure out how to use them. Before diving into how you use third-party cookies, you need to know what they are and how they can benefit your business. Read on to learn more!

They are used to craft personalized experiences for users

The data related to each user is an invaluable asset for a browser. This information can tell marketers the kinds of sites a user visits and how much they interact with content. Outside of language preferences, cookies tell us what we need to know to deliver relevant, targeted ads.

A user’s browser is packed with data about their interests, habits, and purchases. With that knowledge, the digital advertising industry can easily cater to an individual’s needs. Websites like Google, Facebook, and Amazon use cookies to help you find what you want on the site.

Users considering a large purchase are likely surfing the web for related topics. This history may be shown through third-party cookies. The data can be accumulated as users navigate blogs and their chosen social media sites.

They are used to optimize the site for better display of users’ devices

Most websites allow users to customize the layout of their pages by selecting certain colors, fonts, and other features. Third-party cookie developers make it easier for users with certain disabilities, such as color blindness, to navigate the site.

As a result, third-party cookies can alter how users are treated online. The more cookies stored on the same device, the slower the browser may run. A third-party cookie alternative is a way to store data on a different server than the one that provides your website’s content.

The main problem with using third-party cookie alternatives is that they can be easily bypassed by users who don’t want to accept them. This can be done by installing an extension that blocks all third-party cookies or changing your browser settings.

They are essential for content delivery and advertisements

Third-party cookies allow a website to remember users’ actions on that website. They may also allow a website to track how many people have seen certain advertisements and how much time they spent watching them.

Some of the most common third-party cookies include analytics, ad serving, and remarketing tools. If you visit an ecommerce website or engage with its content, such as an ad, this same website can use third-party cookies to track your browsing behavior

They help ensure visitors get the most relevant information when visiting the website. These cookies can make it easier for them to increase conversion rates. By noticing these patterns, marketers can issue more relevant targeted advertising for this user.

What’s the Problem With Third-Party Cookies

So, with that information in mind, what’s the big deal with third-party cookies?

They seem pretty harmless, right? The information stored in cookies lets users save advanced settings across different sites, stores minor site data, and improved online advertising. For almost 20 years, netizens have coexisted with cookies.

Now, they’re calling for the ability to block cookies.

What’s changed?

Setting the Stage for Failure

To be fair, not everyone was happy about cookies. Mozilla Firefox and Safari have been blocking third-party cookies since 2013, and savvier netizens have always known of them and their ability to track users.

However, the biggest blow to third-party cookies was likely dealt with in 2018, when the Cambridge Analytica scandal exposed the potential dangers of sharing user data. The scandal’s fallout exposed some of the darker sides of cookies and tracking, including the ease with which someone could begin identifying users online.

This strengthened the push for international regulations to protect internet privacy, including the General Data Protection Regulation and California Consumer Privacy Act.

The Beginning of the End of the Third-Party Cookie

Aside from the potential user privacy violations that third-party cookies may pose, many consumers are particularly worried about government surveillance. This has led to a rise in technology that blocks third-party cookies, and some users will even block cookies altogether.

Privacy-first browsing sessions are becoming increasingly popular, rendering many statistics obsolete or broken. More precisely, upwards of 30% of data about website visitors is no longer accurate due to enhanced tracking protection. That’s a lot of wasted time, energy, and money!

The Result: Google’s Announcement

This leads us to Google’s 2020 announcement, which declared the upcoming obsolescence of third-party cookies. As of today, Google Chrome will continue to support these codes until 2024.

What Will Change for Third-Party Cookies?

So, what do we do as marketers?

This isn’t exactly an isolated problem, and it’s not a particular website with a relevant issue. This is a huge problem, and digital advertising must adapt now to stay relevant.

As third-party cookies are phased out, marketers must stay up-to-date on the news and features that Google plans to implement.

Namely, marketers will need to dig into the Google Privacy Sandbox project, which spearheads the company’s advancements toward blocking third-party cookies.

Google’s Topics API

Most of Google’s digital advertising solutions will rest upon its new Topics API. (This technology replaced its spider-web-like FLoC technology.) Google Chrome developers claim that the Topics programming will replace how modern cookie attributes determine internet users’ interests.

Instead, Chrome will assign each user a unique token. This identifying token follows users across every website with the Topics technology installed, mirroring how third-party cookies work. However, unlike third-party cookies, the Topics API will minimize the amount of cross-site tracking that advertisers can access.

Browser history will be hidden from marketers, but we’ll still gain access to the top “topics” that a user has browsed over the past three days. These interests are picked from a curated list by Google’s machine learning, which determines a site’s category based on its domain name.

Google currently maintains a list of approximately 300 topics and plans to open the database to public edits.

FLEDGE API

Topics will also fuel the new Google Ads bidding system, which is known as First Locally-Executed Decision Over Groups Experiment (FLEDGE).

The FLEDGE platform will run live on-site bids for advertisements. A mix of monetary bids, relevance, and availability determines winners. This information will be aided by the user’s browser information stored by the Topics API.

Trust Tokens

One of the more unique developments within the Google Sandbox is its Trust Token API. Unlike many other aspects of the project, this is not meant to prevent cross-site tracking. Instead, the Trust Token system is designed to help marketers and Google Analytics.

Trust Tokens will work like Topics. Users are assigned unique tokens, but these tokens determine their status as valid customers. Developers hope this system can help websites refine their content settings and reduce the amount of money the digital advertising industry spends on bots.

Currently, Google plans to give websites the power to issue their Trust Tokens. These verifications can be tied to user behavior (i.e., downloading content or visiting a certain number of pages).

First-Party Sets

Finally, Google Chrome will feature First-Party Sets. These lists of related websites will mirror how third-party cookies work, although their scope will be severely limited.

The idea is that marketers can claim ownership of multiple domains and exchange site data within that private ecosystem. Any information gathered by one of the owner’s sites will be treated like a first-party set on another. However, the same data will not carry over to a different domain.

The Key Points to Know

It’s a lot of tinkering and behind-the-scenes code, so reviewing everything that will change is difficult. The information I’ve presented is just a small sample of Google’s upcoming redesigns. The Privacy Sandbox will not be a one-to-one copy of modern tracking cookies, and it isn’t meant to be.

That doesn’t mean marketers should be afraid! While user privacy remains the central mission of Google’s project, the company remains dedicated to providing the digital advertising industry with essential data.

Targeted advertising is about to change, but plenty of analytic features will remain in place.

From a digital advertising perspective, the most important changes will be:

• An emphasis on opt-in consent and first-party data
• Changes to attribution reports
• Changes to current Google Ads bidding
• Expiration dates on data (currently three days)
• Losing third-party tracking cookies
• Slightly less demographic data (i.e., age, gender, and race)

These changes have yet to be finalized, and they may change! With that in mind, marketers must begin to detach themselves from third-party cookies and embrace other site data. Third-party cookies work now, but increasing awareness of internet user privacy means that the best way to get ahead is to update your approach.

How to Beat the Extinction Event

There are a few ways to overcome the upcoming death of third-party cookies.

The best approach will mix three elements:

• Strategy
• Technology
• Zero-party data

Reframe Your Thinking With Contextual Targeting

While the loss of cookies may seem like a fatal blow for targeted ads, there are still plenty of ways to deliver personalized content. One of the most reliable ways to place your content in the right setting is to use contextual marketing, which allows marketers to show their advertisements on pages that relate to their product.

For example, someone selling wedding dresses would likely place a contextual bid on a blog about wedding planning. This will guarantee that the audience is engaged and interested in what you’re selling, and the most advanced iterations will be optimized for tone and the user’s device.

Obtain Your User’s Consent With Zero-Party Data

Moreover, it’s worth remembering that first-party cookies won’t be removed. Your party data remains safe.

However, if you want to take things one step further, it’s time to invest in zero-party data. This information is gathered through explicit consent. In fact, you can’t really track users with this information, but you can refine your targeting.

Now, if you’re going to utilize this strategy, you’ll need to have a clear plan to obtain your users’ consent. This is usually done with incentives. Brands often provide discount codes or {lead magnets} in exchange for customer information.

This won’t replace the functionality of third-party cookies, but it can dramatically improve your targeting capabilities. With the right CRM software, your data will pervade without the need for web browsers and cookies.

Alternative Technology

Finally, we can’t have a discussion about third-party cookies without mentioning the many alternatives. These options have their own unique challenges, and marketers should carefully weigh the benefits against the risks of these options. In some cases, the ability to track users is improved, but your company will ultimately be liable for the data it collects.

In this privacy-minded world, many marketers prefer to use future-proofed zero-party data. Nonetheless, these third-party cookie alternatives are worth a mention.

• Fingerprinting: The most robust replacement for third-party cookies is digital fingerprinting. This process assigns details to a user based on a unique identifier and stores it on a remote server. The data cannot be altered, which makes it an invaluable asset. However, fingerprinting is considered extremely invasive and is largely being discontinued due to user privacy concerns.
• Publisher-Provided IDs: While a publisher’s customer data is first-party to them, it isn’t for you. When using a PPID, marketers often get access to a robust tools menu with plenty of information about who is interacting with their content. PPIDs are common on social media sites.
• Unique Identifiers (i.e., UID 2.0 and RampID): A unique identifier is one of the most popular third-party cookie alternatives. This cryptographic token is assigned to a unique bit of data, such as a phone number or email address. When users perform certain actions, that bit of data is updated with more information. These are somewhat decent alternatives to third-party cookies, but they rely on obtaining user permission.

A Word of Caution

Be aware of the danger if you choose to dabble in these alternate technologies!

These strategies may work, but customers disable cookies for a reason. People do not want to be tracked, and trying to evade that desire may come back to haunt you. Moreover, website visitors will likely abandon a brand if any behind-the-scenes data hoarding is exposed.

For this reason, the safest way to replace your third-party data is a mixture of contextual advertising and zero-party data. These tactics do not require users to enable cookies, nor do cookies set your marketing team’s goals and limitations.

Avoid the Hassle of Third-Party Cookies

If all of this was a bit much, that’s understandable! There’s a lot to learn about cookies, and the future of cookies related to your marketing remains uncertain.

Digital marketing is hard, and there are many facets to its success. Both third and first-party cookies are complex topics, and many disagree on their use.

Email marketing avoids these issues by utilizing data provided by your buyers. This voluntary zero-party information can be used as you wish, and its inclusion often results in remarkably unique campaigns.

If you’re looking for a simpler way to handle your marketing, consider contacting me! We can discuss your brand’s needs and see if email marketing — an enduring strategy with little to no reliance on any party cookies — is right for you.